How many industries are there for marketing
Marketing budget: Efficient advertising planning
Basis for the marketing budget: the marketing mix
The customer will not buy the best product if he does not know it - marketing is accordingly important.
In the chapter Marketing Mix (the 4Ps of Marketing) you have worked out the various marketing measures. Now it is a matter of summarizing the planned marketing measures in numbers and creating a convincing marketing budget. In doing so, you must not forget topics such as total advertising costs and advertising efficiency when planning your advertising.
Include marketing measures in the marketing budget
Since you have already determined which marketing measures you have planned, especially under communication policy, you can now start creating the marketing budget.
Note that focusing on a few marketing measures is usually more effective. At the beginning it is better to limit yourself to "only" 2-3 marketing measures and advertising material with which you can best reach your target group - you can avoid excessive wastage and thus unnecessary costs. If necessary, you can still add further marketing measures after the start of the company.
When you have determined the final marketing measures (i.e. which marketing measures, which media and the frequency of the advertising placement), you can create the marketing budget. We have developed a free marketing budget tool that you can download here.
Caution stumbling block: take all advertising costs into account!
The marketing budget often does not take all advertising costs into account. You should therefore make sure that you do not forget the following points when calculating your advertising costs in your marketing budget:
- Travel expenses (including time; especially relevant for field service)
- Design costs (design of the advertisement)
- Production costs (production; e.g. printing the poster)
- Media costs (costs for distribution and publication, e.g. in magazines, radio, etc.)
- Other costs (e.g. taste samples, gifts, etc.)
In addition to the total advertising costs, you should pay attention to another point in the marketing budget: advertising efficiency.
Efficiency as an important criterion for the marketing measures
Ultimately, the following also applies to marketing measures: an attractive price / performance ratio is crucial. To calculate the advertising efficiency of individual marketing measures, put the price you pay for a medium (trade fair, poster, online advertising, etc.) in relation to the reach (how many people in your target group you can reach with the respective medium).
With a marketing budget in which you have checked individual measures for efficiency, you can not only avoid unnecessary costs, but also convince potential investors!
The advertising efficiency does not say much about the quality of the marketing measures, but you can use the advertising efficiency calculation to determine relatively easily how much you have to spend per customer contact with which medium.
We have also created a free tool for advertising efficiency that we have integrated into the marketing budget tool.
By the way: On the Internet in particular, you can see relatively quickly which marketing measures are paying off (the keyword here is conversion). You can find more about online advertising and online sales here.
Marketing budget check: guidelines
What is a reasonable marketing budget? Is it 3% of the sales volume, as is the case with suppliers to the automotive industry? Is it 8-10% of the sales volume, as is often the case with companies in the service sector? Or is it even 30% of sales, for example at Red Bull?
Giving guidelines for a marketing budget is complicated and depends on the respective business model and, accordingly, the industry. As a first step, take a look at the VR industry letter to see how much your industry spends on advertising on average. Then add at least another 25% -50% to this value (if the average is 4%, you should expect at least 5-6% for your marketing measures), because as a new company you have to invest more in advertising, to make your products known.
If you cannot find any industry key figures, we recommend that you calculate 10-15% of sales in your marketing budget, which is roughly the golden mean.
The goal is ...
... that you create a convincing marketing concept based on the 4P's in your business plan. The individual marketing measures must then be taken into account in the marketing budget. Do not forget about topics such as total advertising costs and advertising efficiency in the marketing budget.
The marketing budget will later flow into the financial plan that you will create after the next chapter of the business plan, the operational organization.
Newspapers, radio, TV and online media provide information about the target groups in the media data - use this information for your research and the selection of the right marketing measures and ensure an efficient marketing budget!
As editor-in-chief, René Klein has been responsible for the content of the portal and all publications by Für-Gründer.de for over 10 years. He is a regular interlocutor in other media and writes numerous external specialist articles on start-up topics. Before his time as editor-in-chief and co-founder of Für-Gründer.de, he advised listed companies in the field of financial market communication.
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